Ellmers Introduces the DEFECT Act to Prevent Obamacare Fraud

WASHINGTON – Congresswoman Renee Ellmers released the following statement this afternoon from her office in Washington:

"As Obamacare continues to collapse under its own weight of top-down, 'government knows best' rule making, the Obama administration is now playing games with the law and forcing it to circumvent proper procedure. Recently, the president announced that the government will no longer require individuals to verify their income and health insurance status before receiving premium subsidies under the law - basically leaving the law without any safeguards to protect from abuse, fraud, and explosive costs to taxpayers. Because of this, I have introduced the DEFECT Act, which will require asset verification before these subsidies roll out under Obamacare."

"It's very simple - if you are applying for health insurance under Obamacare, you must be able to prove that you are truly in need of these subsidies. Without this law, anyone - regardless of need or wealth, will be able to receive government-funded subsidies. The risk of fraud, waste and abuse is truly astounding and will be unprecedented. If the president fails to act as a responsible steward of our nation's resources, then we will stand up and do what is right for the American people and protect our future from insolvency."

This morning, Congresswoman Renee Ellmers introduced the DEFECT Act. The DEFECT Act (Delaying Enrollment in Federal Exchanges to Certify Trust), would require asset verification to be in place before subsidies roll out under Obamacare. The purpose of this bill is to ensure that health insurance subsidies go to those who truly need them, and not to those looking to take advantage of the “honor system”, as the administration describes it. The DEFECT act will prevent fraudulent subsidy claims and ensure that funds are available for the truly needy.

Background:

On July 5, 2013, the Department of Health and Human Services (HHS) issued a 606-page final rule for the Patient Protection and Affordable Care Act (PPACA). Instead of requiring state exchanges to verify an applicant’s income, which is used to calculate the amount of subsidy an applicant can receive, the final rule allows state exchanges to accept the applicant’s “attestation” of household income. The administration ruled that exchanges could simply dispense with the verification process and hand out subsidies based on the “honor system.”